If the supply curve slopes upward and a $3 per unit tax on suppliers raises the profit-maximizing price by $3, demand must be perfectly inelastic
a. True
b. False
A
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In Figure 5-7, budget line B compared to A clearly shows that the
A. price of wine increased. B. price of beer decreased. C. price of beer increased. D. consumers’ money income increased.
It is difficult to get the necessary information to apply corrective taxes in the real world, thus _____
a. most government reluctantly apply to reduce negative externalities b. use regulation to reduce negative externalities c. use moral suasion to reduce negative externalities d. most governments fail to do anything to reduce negative externalities
If cheese spreads and butter are substitutes, an increase in the price of butter will:
a. shift the demand curve for cheese spreads upward. b. shift the demand curve for cheese spreads downward. c. shift the demand curve for butter upwards. d. shift the demand curve for butter downward.
The demand for foreign currency is derived from the demand for that country's goods and services
a. True b. False Indicate whether the statement is true or false